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Boohoo confirms offer to acquire Karen Millen

Lauretta Roberts
06 August 2019

Boohoo has confirmed that it has made an offer to acquire Karen Millen and its sister brand Coast in a move that would, if successful, take the online group into the premium fashion space but also casts doubts on the future of Karen Millen stores.

Late last night Sky News reported that the Manchester-based online fast fashion group, which also owns the PrettyLittleThing, Miss Pap and Nasty Gal brands, had made a swoop for Karen Millen and was close to buying it in a pre-pack administration deal.

This morning AIM-listed Boohoo issued a brief statement noting the "media speculation" and that "it has made an offer to acquire the online business of renowned British brands Karen Millen and Coast, together with all associated intellectual property rights".

"The Group believes that the online business of these brands would represent highly complementary additions to its scalable multi-brand platform and extend the Group's offer as part of its vision to lead the fashion e-commerce market globally," the statement contained.

An acquisition by Boohoo does, however, cast doubt on the future of the chain's 57 standalone stores and 175 concessions. One analyst told Sky News that it was "inevitable" stores would close.

Should the deal with Boohoo go through, it would mark the conclusion of a six-week sale process during which Deloitte attempted to sell the business in a solvent state.

Karen Millen, which is led by former Bonmarche CEO Beth Butterwick, is owned by Icelandic bank Kaupthing. Last year it acquired the online operations and brand of its fellow group brand Coast, which specialises in occasion wear. The company recorded sales of £162m in the year to February 2018 with a pre-tax loss of £9.5m.

Butterwick has been leading a strategy of turning the fashion brand into a global lifestyle brand and has signed a number of licensing agreements for footwear, accessories, jewellery and swimwear in recent months.

Kaupthing is also the parent of chains Oasis and Warehouse and a sale process for these two brands was abandoned in 2017 after it failed to find a suitable buyer.

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